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SoftBank plans to secure $1.86 billion in debt as the CEO promotes the potential of advanced AI technology.

SoftBank unveiled its intention to issue bonds denominated in euros and dollars to reduce debt and concentrate on investments in artificial intelligence. The Japanese conglomerate plans to issue approximately $900 million in U.S. dollar-denominated bonds in two segments, and 900 million euros, equivalent to $962.8 million, in two segments as well. These bonds will carry interest rates between 5.4% and 7% annually.

The funds raised will be allocated towards “debt repayment and general corporate purposes.” Following the announcement of the bond issuance, its stocks increased by 2.5%.

SoftBank’s decision to secure funds through debt arises as the company starts to narrow its overall financial losses and achieves milestones such as the initial public offering of chip designer Arm. The organization, known for its extensive technology investment arm named the Vision Fund, is indicating a willingness to increase investments in AI enterprises.

In a recent public appearance, Masayoshi Son, the founder and CEO of SoftBank, discussed a concept labeled artificial super intelligence (ASI). Son described ASI as AI that surpasses human intelligence by 10,000 times, a development he anticipates within the next decade. SoftBank likely aims to leverage the growing positive sentiment among investors, as evidenced by a 65% surge in its shares year-to-date.

Masayoshi Son, CEO of SoftBank, delivers a speech at the annual general meeting of the company in Tokyo on June 20, 2024.

Kosuke Okahara | Bloomberg | Getty Images

Source: CNBC

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